Border Bleed Revenues, Recapturing Pennsylvanians’ Purchases

Our current outdated system has turned many Pennsylvanians into confessed bootleggers, traveling to neighboring states to purchase their wine and spirits.  This causes “border bleed,” an activity where other states are capturing lost revenue through purchases made out of state by Pennsylvanians.

According to a report by the Distilled Spirits Council of the United States (DISCUS), border bleed accounts for $313 million in losses from retail revenue to Pennsylvania  Cross border purchases by Pennsylvania residents total over 900,000 cases of spirits and over two million cases of wine, about 16.5 percent of total sales.

 view larger

According to the PLCB’s own Neiman study, $220 million of those lost sales and taxes comes from residents of Philadelphia and its surrounding counties alone.  45 percent of residents in Philadelphia and its surrounding counties purchase some or all of their alcohol outside of Pennsylvania.

Border bleed robs Pennsylvania of $17.3 million in excise tax from wine purchases. The average amount of money spent on each trip to another states to purchase alcohol is $260 (summation of the average amounts for both exclusive border bleeders and exclusive out-of-state shoppers).

Of the percentage of Pennsylvanians who ONLY shop for packaged alcohol outside of Pennsylvania, the following shows their areas to shop:
•    14 percent in New York
•    30 percent in New Jersey
•    38 percent in Delaware
•    18 percent in “other” states

If we had a private system that would better serve the current demands of the public, we could recapture those sales, taxes, and even improve selection.  This would increase profitability and create jobs to replace those displaced by the store closures.